L&G ups its care home sector investment

Legal & General Property has acquired three care homes for a total of £25.2m, bringing L&G’s investment in the sector to approximately £220m.

LGP has acquired the care homes in Stratford-upon-Avon, Kidderminster and Stansted, on behalf of its £1.7bn L&G UK Property Fund, from the Careplaces Fund, which specialises in healthcare property.

The three properties are all let to national care home operator Care UK on 30-year leases, with yearly RPI increases built in.

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Matt Jarvis, fund manager for the L&G UK Property Fund, said: “While care homes are still regarded as an alternative property sector by many, we recognise the long-term need for investment and service in this market and recognise Care UK as one of the more established and better quality operators.”

Speaking last year, Geraldine Kaye, the managing director of consultancy Gaaps Actuarial, argued that pensions and long-term care provision must sit more closely together to meet the needs of an ageing generation.

She said: “I believe pension schemes should be investing much more in care homes and retirement villages for our pensioners.”

This, she argued, would help pensioners to live in more affordable homes that met their various needs, and help to reduce the burden on the NHS: “This would result in greater savings being made for the economy, for the pensioner, and for the state.”

Adviser view

Peter Matthew, managing director of Cornwall-based Jacksons Wealth Management, said: “There is going to be more and more care needed as we are living longer, so it is probably a very sound investment for L&G.”